The correct answer is C — Host-based firewall.

According to the WGU Cybersecurity Architecture and Engineering (KFO1 / D488) materials, a host-based firewall enforces traffic control policies at the endpoint level. It can allow or deny traffic based on application, port, IP address, and protocol rules, restricting access to only approved services and applications on a system.

Antivirus tools (A) detect malware but do not control network traffic. Two-factor authentication (B) secures user access but does not manage network traffic. HSMs (D) handle encryption keys, not network access control.

Reference Extract from Study Guide:

"Host-based firewalls restrict traffic at the system level, permitting only authorized services and applications, enhancing endpoint security."

— WGU Cybersecurity Architecture and Engineering (KFO1 / D488), Endpoint Protection and Firewalls

=============================================